About this booklet

If you're saving for your retirement, you'll want to know how to
get the most out of superannuation ('super'). This booklet will
help you:

understand more about super

find calculators and interactive tools

make better decisions.

Get the facts

The first step to making sound financial decisions is to make
sure you have accurate, up-to-date information. Visit your super
fund's website and our superannuation section
for answers to your questions.

Decide what's best for you

The information presented here can start you off on the right
foot with general tips and explanations. However, not all these
points may apply to your situation. It's important that you decide
what's best for you. For personal advice about super, speak to your
fund as they may have advice services, or see a licensed financial
adviser.

Make it happen

When it comes to money, good intentions are never good enough.
Act now and you could watch your super savings grow.

What is super?

Superannuation is a tax-advantaged way to save for your
retirement. By law, your employer must pay 9.5% of your salary into
a super fund. This is called the 'super guarantee'. The super
guarantee is gradually increasing to 12% in the coming years.

You can make extra contributions to your super fund from your
own money. Lower income earners may also receive additional
contributions from the government.

During your working life, these contributions add up or
'accumulate'. Your super money is also invested by your super fund
so it grows over time. Contributions and investment returns are
taxed at a special rate - generally lower than what you'll pay on
other money you earn or invest.

Generally, you can't access your super until you retire, and
after your preservation age - the age at which you're entitled to
withdraw money from super. When you retire, the money you have
saved through super (your retirement benefit) can be used to give
you regular income.

Super decisions to grow your super savings

Choose a super fund

Select and monitor your investment strategy

Decide what life insurance you need

Make extra contributions

Change funds if you need to

Find and consolidate all your super accounts.

How to make the most of your super

Use ASIC's MoneySmart retirement planner

If you take a few small steps now, it could make a world of
difference to your life when you retire.

The retirement planner is free, easy and quick to use. Simply
enter your age, income and current super balance to get a
projection of what income your super savings might give you when
you retire.

Maximising your retirement income

How much income you'll have in retirement is the key to your
future lifestyle. The retirement planner can show you what you can
do to increase your retirement income. For example, you'll see
straight away the dollar impact of:

choosing a super fund with lower fees

selecting a different investment option

making extra contributions

working longer.

Smart tip: Talk to your partner

It's always a good idea to talk about money with your
partner. You can use theretirement
planner as a couple. This is a great way to start a
discussion about your retirement goals.

Important: Super strategies for women

Women tend to live longer than men and take more time out of the
workforce to raise kids or deal with other family responsibilities.
This makes it even more essential for women to get enough super to
last through retirement.

If you're planning to take significant time out of the
workforce or cut back your working hours, start putting extra into
your super now to make up for the time when you won't be
working.

If you're earning a low income, consider making after-tax
contributions because you may be eligible to receive a government
co-contribution of up to $500. Go to ato.gov.au for eligibility
rules.

If you have a spouse, talk to them about boosting your super.
There are tax benefits in making a spouse contribution of up to
$3,000. You can also split your employer super contributions with
your spouse.

Which super fund should you choose?

The secret to being financially secure in retirement is
relatively simple: save, save, save. The earlier
you start, the better.

Super is a great place to save for your life after work because
you usually can't withdraw your savings until you retire. (There
are limited circumstances when you can access your super early -
see Getting access to your super early.)
Super funds will help you grow your savings over your lifetime. So
choose carefully and review your choice when your situation
changes.

Get the facts

If you are employed, in most cases you can choose which fund
will receive contributions from your employer. Your employer will
tell you if you do not have this choice.

Decide what's best for you

Compare funds in terms of features, fees and investment
performance. Super comparison websites can help you do this. But,
before you do, read our page on super comparison
websites.

Make it happen

Make your choice - When you start work,
your employer will give you a 'standard choice form' to fill out to
choose a super fund. Provide your tax file number (TFN) and you'll
avoid paying unnecessary tax and ensure that your super won't get
lost.

Roll over any existing savings - Consider
transferring money into your new fund from any other super funds
you have money in, to avoid paying multiple fees.

Ensure the money's there - Sometimes
employers - perhaps because they are struggling financially - don't
actually make super contributions when they should. If you suspect
this is happening, contact the Australian Taxation Office (ATO) on
13 10 20 for advice or go to ato.gov.au/unpaidsuper.

Two basic types of funds

Accumulation funds

Defined benefit fund

Most super funds are accumulation funds.

These funds are less common and the retirement
benefit is defined by the fund rules.

The value of your retirement benefit depends on:

how much money your employer and you contribute

how much your fund gains - or loses - from investing the money,
after fees and taxes.

The value of your retirement benefit usually depends on:

how much money your employer and you contribute

how long you're in the fund

your salary at retirement.

For example, your benefit might be worth five times your final
salary after 25 years' membership.

You take on the risk of your fund's investment
performance. When you retire, you can access your account
balance.

If your fund's investment performance is poor,
your employer might still ensure the fund can deliver the
benefit.

MySuper

If you don't choose a fund, your employer must pay your
contributions to a fund that offers a MySuper option.

MySuper accounts offer:

lower fees (and restrictions on the type of fees you can be
charged)

simple features so you don't pay for services you don't
need

a single diversified investment option or a life cycle option
(see 'Life cycle' option, below).

Comparing fees and costs

Some funds charge management costs as a percentage of your super
fund balance. If you are paying this way, 1% per year in management
costs will cost you $100 if you've got $10,000, and $500 if you've
got $50,000 in super. Other funds charge a set fee, such as $1 per
day or $100 per year, while others charge a combination of fixed
and percentage based fees.

Case study: Keith chooses lower super fees

Keith, 30, earns $50,000 per year as a delivery driver. He had
$20,000 with a super fund that charged 2% per year in fees
(including advice fees).

After shopping around for another super fund that had the
features he wanted, he changed to a fund that charges 1% per year
in fees.

By changing to a super fund with lower fees, Keith could have
$67,000 more in his super when he retires at age 70. In other
words, saving 1% per year in fees means he gets more than 20% extra
in super when he retires.

What's the best investment option?

Super funds grow your savings by investing the money that's in
the fund. You can decide how they invest your money. Your
investment decisions - your strategy - will influence how much
money you'll have to live on in retirement.

Get the facts

To find out about the different investment options offered by a
super fund, go to the fund's website, download the product
disclosure statement or call the fund.

Decide what's best for you

When deciding between investment options, consider:

your age

how long before you can access your savings - generally at
retirement

how much investment risk you are willing to take on.

For example, if you're unlikely to access your super for at
least 5 years, focus on growing your total benefit. The longer you
have your savings invested, the more opportunity you have to
increase the value of your final benefit and ride out the impact of
any years of poor investment performance.

Alternatively, if you're retiring and intend to withdraw all
your super in less than 5 years, you may want to know exactly how
much you'll have - and not risk losing any of it in the meantime. A
lower risk, lower return strategy will help preserve the value of
your savings.

Make it happen

Unless you choose, your savings will be invested in a MySuper
option. To change to a different investment option, contact your
fund. Most funds allow you to change your investment options
online.

Typical investment options

.

Higher returns, higher risk

Lower returns, lower risk

.

Growth

Balanced

Conservative

Cash

Mix of investments

Around 85% in shares and property with the rest in cash or
fixed interest

Around 70% in shares and property with the rest in cash or
fixed interest

Around 30% in shares and property with the rest in cash or
fixed interest

100% in deposits with Australian deposit-taking
institutions

Return target

5.0%

4.8%

3.8%

2.7%

Risk

High

Medium

Low

Very low

Expect a loss

4-5 years in 20

4 years in 20

0 years in 20

0 years in 20

Value of investing $10,000 after 5 years

$12,800

$12,700

$12,100

$11,400

This table includes indicative actuarial figures for the purpose
of comparing example investment options. Return target is before
fees, taxes and other costs. Projected value is before fees, taxes
and costs; rounded to the nearest $100; and assumes all income is
reinvested monthly.

Smart tip: Find out more about investing

Some super funds offer a wide range of investment options.

If you want to find out more about investing, whether within or
outside super, visit our investing section.

'Life cycle' option

Some funds, including through a MySuper option, offer a
ready-made investment strategy, usually based on your age.

If you choose this strategy, your fund will select an
appropriate investment mix for you based on your current age. Then,
at pre-determined intervals, the fund will automatically switch
your savings into a more defensive investment mix.

Typically, over the course of your working life, your investment
strategy progressively changes from growing to preserving your
balance.

Typical investment mix for a lifecycle investment strategy

.

If you are under 45

If you are 45-54

If you are 55-64

If you are 65 or older

Shares and property

85%

75%

55%

40%

Cash and fixed interest

15%

25%

45%

60%

Comparing investment performance

Your fund's investment performance over the long term usually
makes a big difference to how much you will have to retire on.
Picking which fund or investment option will perform best over time
is difficult for even the most experienced investors. Review your
investment choice every few years and when your circumstances
change.

Here are some tips for judging performance:

Compare like with like - It's fair to
compare a growth option with another growth option - but not with
the performance of a conservative option.

Look for performance over time - This
should be over at least 5 years. Don't be swayed by one-year
wonders.

Do you need insurance?

Most funds offer insurance that can provide greater financial
security for you and your family. Being insured through super is
generally an easy option - and cost-effective because premiums are
paid from your pre-tax income. Insurance premiums are usually
deducted from your super account, which reduces your super, unless
your employer pays for your cover.

Get the facts

Super funds typically offer three types of insurance for
members:

Death cover (also known as life insurance or term life
cover) - Your beneficiaries receive a benefit when
you die.

Total and permanent disability (TPD)
cover - You receive a lump sum benefit if you become
seriously disabled and your ability to work is affected.

Income protection cover - You receive
regular income for a specified period if you can't work due to
temporary disability or illness.

Find out:

What is the insurance premium?

Do you get insurance cover automatically - without a health
check?

What happens when you're on extended leave, e.g. maternity
leave?

Can you opt out and not be charged? (You may already have
insurance in another super fund or outside super.)

What happens to your cover if you change jobs?

Are there any limitations for age, dangerous activities,
part-time or casual work?

What happens to your cover if you change funds?

Decide what's best for you

Think about whether to take up or keep the insurance protection
your fund provides, or whether you want more cover.

To find out more, see our page on life insurance. If
you're still unsure - or your situation is complex - consider
getting professional financial advice.

Make it happen

Case study: Ahmed puts a safety net in place

Ahmed, 30, works in the construction industry. He and his
partner Clara have a 2-year-old son and are expecting their second
child. Ahmed realises that if anything should happen to him, Clara
would find it hard to manage financially.

He decides to apply through his super fund to increase his term
life cover. After completing a medical questionnaire, he adds an
extra $200,000 insurance to cover the mortgage on their home.

Should you put extra into your super?

Because we are living longer, our super savings have to support
us for longer. It's never too early to consider maximising your
income in retirement.

Get the facts

Will you have enough super when you retire?

.

Standard of living in retirement for a couple.

Standard of living in retirement for a single
person.

.

Modest

Comfortable

Modest

Comfortable

Annual after-tax income required*

$39,353

$60,264

$27,368

$42,764

Lump sum needed at retirement**

$70,000

$640,000

$70,000

$545,000

*Retirement Standard benchmarks for the 2018
March quarter from the Association of Superannuation Funds of
Australia (ASFA). To see their latest quarterly data, go to superannuation.asn.au
.

**ASFA figures converted into lump sums for
retirees aged 65 who will live to age 85. Life expectancy for a
65-year-old is currently 87.3 years for women and 84.6 years for
men (Source: Australian Bureau of Statistics 2014-16 Australian
Life Tables). The calculation assumes an investment return of 6%
after fees and taxes. All figures are in today's dollars,
discounted for inflation at 2.75%.

ASIC's MoneySmart retirement planner

To get a handle on your personal situation, find your latest
super member statement and go to the retirement
planner. Spend a few minutes entering your numbers and you'll
find out:

what income you are likely to have from super and the Age
Pension after you retire

how contributions, investment options, fees and retirement age
affect your retirement income from super

what actions you can take to boost your super and retirement
income.

Decide what's best for you

Don't leave it too late to build up your super. The later you
start, the more you will have to contribute to reach your target.
However, you should also weigh up the benefits of extra super
against your other priorities - paying off debt (credit cards, home
loan) or saving (for a home or to start a family).

You can contribute to super as long as you meet the 'gainful
employment' test. You must have worked for at least 40 hours within
a period of 30 consecutive days during the particular financial
year. Gainful employment does not include unpaid work.

Make it happen

Contribute regularly or by lump sum - You
can transfer funds online, send a cheque or set up a regular
deduction.

Talk to your employer - If you want to
sacrifice salary, negotiate the arrangement with your employer.
Unless you agree otherwise, your employer may be entitled to reduce
their usual contribution by the total amount you salary sacrifice
or pay a lower contribution based on your new 'reduced' salary.
Check this before you agree to salary sacrifice.

Smart tip: The Age Pension

Many retired people live on a mix of their own savings and the
Age Pension. In deciding if you have enough super for your
retirement it's important to consider whether you are likely to
receive the Age Pension.

How much you're likely to receive will depend on your income and
assets. Centrelink's Financial Information Service can give you
information on how your assets and super may impact your Age
Pension benefits. Go to humanservices.gov.au or
call 13 23 00.

Pre-tax 'salary sacrifice' contributions

If you pay more than 15% in income tax, you could consider
sacrificing some salary and asking your employer to pay the same
amount as a pre-tax super contribution.

You need to be careful, though, as there is a limit (cap) on the
amount of pre-tax contributions you can make. Go to ato.gov.au for more information
about the limits on super contributions.

Tax deductible contributions

You can claim a tax deduction for any personal super
contributions you make, up to pre-tax (concessional) contribution
limits.

This may suit you if you are self-employed or your employer does
not allow you to salary sacrifice. Go to
ato.gov.au for more information about the limits on super
contributions.

Case study: Maria salary sacrifices into super

Maria, 37, is married with two children. She earns $90,000
before tax, excluding her employer's super contribution. With her
husband's income there is enough to cover the family's mortgage and
living expenses. Maria decides to ask her employer to redirect
$10,000 of her pay into super as a 'salary sacrifice'.

Maria pays less tax overall because her new income is only
$80,000 and her $10,000 super contribution is taxed at only
15%.

Maria also decides to review this arrangement every 12 months,
as her circumstances or contribution limits may change.

After-tax contributions

If you can spare the money, contributing from your after-tax
income can really boost your savings.

Again, it's important to be aware of the limits (caps) on how
much you can contribute. If you exceed the limits you may have to
pay a lot more tax. Go to
ato.gov.au for more information about the limits on super
contributions.

Government co-contribution

If you are an employee and make after-tax contributions, you may
receive a government co-contribution based on your income and how
much you contribute. Self-employed people are also eligible,
subject to certain conditions.

If you're eligible, the ATO pays the co-contribution
automatically into your fund, based on your tax return and
information received from your fund.

Case study: Jay makes after-tax contributions to super

Jay, 26, earns $28,000 a year from his part-time job. He decides
to grow his super by contributing an extra $40 per fortnight.

"My mates gave me a bit of stick but I reckon I'll be better off
in the long run by putting away a bit more into super than putting
away a six-pack each week."

In addition, Jay qualifies for a super co-contribution from the
government. By the time Jay retires at 65, these additional amounts
will have boosted his super by $90,000 - that's 40% more than if he
did nothing.

Should you
change funds?

Changing super funds - or switching investment options within
your fund - may help increase the amount of super you'll have at
retirement. But take care - you could lose important benefits or
face higher costs.

Get the facts

Check how well your current fund performed over at least 5-10
years. The fund's annual report tells you about the investments it
made and how they performed during the year.

Check if the actual return broadly matches the return target for
your fund. If not, look for a reasonable explanation.

Don't panic if the short-term returns are negative: remember
that super is a long-term investment.

Make sure you understand the consequences of changing funds,
especially if you're in a defined benefit fund. Check for:

exit or termination fees

whether the change will affect how your employer
contributes

any changes in insurance cover

how the change affects your retirement benefit.

Decide what's best for you

When you understand the consequences, you may still feel it's
worth changing funds. Sound reasons for changing funds include:

consolidating your super into one account

reducing fees

investing in a fund with better features, or

getting out of a poorly performing fund.

If you've sought financial advice about changing funds, make
sure your adviser explains his or her recommendations in a Statement of Advice.

Make it happen

Tell your employer - Once you've joined
your new fund, make sure your employer knows where to send future
contributions.

Transfer your super from existing
accounts - If you want to keep all of your super in
one place, contact your new fund over the phone or login online and
request a transfer. You can also consolidate your super funds by
logging into your myGov account. Go to my.gov.au and link to the
ATO.

Keep the paperwork - Once your savings
have been rolled over to your new fund, your old fund will send you
a rollover benefits statement. Check it's correct and keep it with
your super records.

Smart tip: Getting financial advice

If you're unsure about things or your situation is complex,
consider getting professional financial advice. You may even be
able to access some kinds of advice at no additional cost from your
super fund.

Should you consolidate your small super
accounts?

Consolidating your small super accounts is a lot easier using
myGov. See our consolidating super funds
page for more information. The sooner you consolidate your funds,
the better. You'll feel more in control and can watch your super
grow.

Get the facts

If you belong to a super fund that doesn't have your current
address, they might consider you a 'lost member', and transfer your
benefits to an 'eligible rollover fund' where your investment
earnings may be less.

If any of your accounts has less than $200, the fund may allow
you to withdraw the money when you finish your employment. Unless
you really need the money, it's generally better to roll it over
into your next fund.

Decide what's best for you

The benefits of transferring the money in several small super
fund accounts into one account include:

saving costs by paying only one set of fees

reducing your paperwork

making it easier to keep track of your super.

However, if you're in a defined benefit fund, talk to your fund
and get advice before leaving.

Make it happen

Getting
access to your super early

You can only access your super before you reach your
preservation age under very limited circumstances:

Incapacity - if you suffer permanent or
temporary incapacity.

Severe financial hardship - if you have
received Commonwealth benefits for 26 continuous weeks but are
still unable to meet immediate living expenses.

Compassionate grounds - to pay for medical
treatment if you are seriously ill.

Terminal medical condition - if you have a
terminal illness or injury.

You may also be able to access your super early if you are
permanently leaving Australia. Contact the Australian Taxation
Office on 13 10 20 for more information about this.

Important: Superannuation scams

Your super is meant for your retirement, not before. Some
illegal operators say they can withdraw your super or move it to a
self-managed super fund so you can access your super money before
you retire. Often, the victims of these scams lose most or all of
their super.

If you are approached about accessing your super early you
should report it to ASIC at asic.gov.au or by calling ASIC on
1300 300 630.

How to make a complaint about your super
fund

Step 1 - Contact your super fund with your complaint

First, talk to your fund. They may be able to solve the problem
for you on the spot. If they can't, or you're unhappy with their
response, then go to Step 2.

Step 2 - Take your complaint further

Ask the fund for their complaints handling procedure or look for
it on their website. Put your complaint in writing (either a letter
or email) and include your name, contact details and the date. Set
out the problem clearly and stick to the facts.

The fund has 90 days to respond to you. You can request they
respond in writing. If you don't receive a response, or you're
unhappy with their response, go to Step 3.

Step 3 - Contact the Australian Financial Complaints Authority
(AFCA)

AFCA handles complaints about providers of superannuation,
retirement savings accounts and annuities, and complaints about
advice on super from a licensed financial adviser. You can only
contact AFCA if you have already contacted your super fund to try
to resolve the problem.